› › A Comparative Analysis Of Real And Accrual Earnings Management Around Initial Public Offerings Under Different Regulatory Environments

A Comparative Analysis of Real and Accrual Earnings Management Around Initial Public Offerings Under Different Regulatory Environments

Author : Mohammad Alhadab

Publisher :

Page : pages

File Size : 12,42 MB

Release : 2016

Category :

ISBN :

Get eBook

Book Description

While earnings management around IPOs has been researched in a number of settings, there has been a relative absence of work that analyses the impact of the regulatory environment on such activities. We find that the regulatory environment does impact the real and accrual earnings management activities of IPO firms. Our results show that IPO firms listing on the lightly regulated UK Alternative Investment Market (AIM) have higher (lower) levels of accrual based and sales based (discretionary expenses based) earnings management around the IPO than firms listing on the more heavily regulated Main market in the UK.



Handbook of Accounting, Accountability and Governance

Author : Garry D. Carnegie

Publisher : Edward Elgar Publishing

Page : 525 pages

File Size : 42,23 MB

Release : 2023-10-12

Category : Business & Economics

ISBN : 1800886543

Get eBook

Book Description

This Handbook explores how accounting, accountability and governance are interconnected, and demonstrates that they must operate effectively together in establishing good personal and organizational behaviour in entities of all types around the globe. It will be crucial for academic researchers working within the fields of accounting, economics, corporate governance, accountability, management and business and be beneficial for accounting, economics and management professionals seeking to clarify and expand upon their knowledge for effective application.



Understanding the Polish Capital Market

Author : Marek Dietl

Publisher : Taylor & Francis

Page : 345 pages

File Size : 40,18 MB

Release : 2022-12-30

Category : Business & Economics

ISBN : 1000817776

Get eBook

Book Description

The first stock exchange in Warsaw – capital city of the Kingdom of Poland– was established in 1817. Over the past 205 years, the fortunes of the capital market have been closely linked to the "bumpy road" of Polish history. The establishment of the GPW Warsaw Stock Exchange in 1991 was a landmark for transformation from a centrally planned communist economy to a market-driven capitalist one. Since the doors of the exchange reopened, Polish GDP per capita (current USD) increased eight times, translating into an average yearly growth rate of over 7%. The capital market has played a pivotal role in the economic success of Poland over the last three decades. It is not easy to precisely quantify the impact, as it was rather a spill-over effect. Economic growth has fostered the development of a capital market, and more efficient conversion of savings to investments via the capital market. The excellence of capital market institutions can be gauged with reference to various parameters. A synthetic measure is so-called market status. According to FTSE Russell (global index provider), Polish capital attained developed market status in 2018, being the first and only post-communist state to do so. It is fair to say that transformation has been completed and developed market status indicates clearly that the institutions and regulations are world class. The current challenge is competing with other developed markets for the best issuers and offering the most demanding investors an excellent trading experience. This book offers scientific insight into the Polish capital market story. Authored by a group of renowned scholars, with contributions aspiring to the highest academic standards for theoretical considerations and empirical research. The book covers various topics, including links between monetary policy and capital markets, micro and macro market structures, and investors and issuers' behaviour and strategies. All chapters are rooted in contemporary finance theory, supported by various econometric models based on the most recently available data. The book aims to provide academics and practitioners insight into the Polish capital market, appealing especially to those interested in gaining a deeper understanding of emerging markets' successful transformation into developed ones. It can also be used as supplementary reading for doctoral and master’s students in finance, particularly relating to capital markets and economics – predominantly development economics and economic policy.



Regulatory Profit Targets and Earnings Management in Initial Public Offerings

Author : Ismail Norashikin

Publisher :

Page : pages

File Size : 14,29 MB

Release : 2014

Category :

ISBN :

Get eBook

Book Description

We examine the extent of earnings management associated with meeting forecasts made in IPO prospectuses in a developing economy where government regulation requires a profit forecast but allow promoters to choose either (1) to provide a profit guarantee or (2) to elect for a moratorium on share transfers for a defined period. Since the manager is mandated to make earnings forecast and there are costs associated with forecast error, we hypothesise that, in the first reporting period following the IPO, managers opting for a profit guarantee will signal their ability to produce a result within the target zone while managers opting for a share moratorium will match that performance to maintain their reputation, with the result that both groups are indistinguishable in the magnitude of earnings management.Using a sample of 92 regulated IPO firms we find a strong negative association between forecast error before earnings management and a firm's discretionary accruals. Our results support the hypotheses, leading to the conclusion that earnings are managed towards the forecast amount, consistent with both the desire not to deviate excessively from the forecast and income smoothing.







A Comparative Analysis of IPO Proceeds Under Alternative Regulatory Environments

Author : Neil Brisley

Publisher :

Page : 8 pages

File Size : 29,23 MB

Release : 2013

Category :

ISBN :

Get eBook

Book Description

Benveniste and Wilhelm (1990) address the problem of an Initial Public Offer where the issuer uses the bookbuilding method to elicit information from potentially informed regular investors. Bamp;W contend that regulatory constraints on the ability of underwriters to price discriminate between these investors can reduce the proceeds available to the issuer. This Comment corrects errors in the derivation of the model and clarifies their central results accordingly. Only under the assumption that regular institutional investors are, on average, less well informed than ordinary retail investors may the uniform pricing constraint bind. Otherwise, a uniform pricing restriction does not reduce IPO proceeds. When regular institutional investors are, on average, at least as well informed as ordinary retail investors we can now rule out the need for price discrimination.



IPOs and Equity Offerings

Author : Ross Geddes

Publisher : Elsevier

Page : 273 pages

File Size : 29,48 MB

Release : 2003-06-06

Category : Business & Economics

ISBN : 0080478786

Get eBook

Book Description

An initial public offering (IPO) is one of the most significant events in corporate life. It follows months, even years of preparation. During the boom years of the late 1990s bull market, IPOs of growth companies captured the imagination and pocketbooks of investors like never before. This book goes behind the scenes to examine the process of an offering from the decision to go public to the procedures of a subsequent equity offering. The book is written from the perspective of an experienced investment banker describing the hows and whys of IPOs and subsequent equity issues. Each aspect of an IPO is illustrated with plenty of international examples pitched alongside relevant academic research to offer a combination of theoretical rigour and practical application. Topics covered are: - the decision to go public- legal and regulatory aspects of an offering; marketing and research- valuation and pricing- allocations of shares to investors - examination of fees and commissions * Global perpective: UK, European and US practices, regulations and examples, and case studies* First hand experience written by an IPO trader with academic rigour* Includes the changes in the market that resulted from 1998-2000 equity boom



Pricing and Performance of Initial Public Offerings in the United States

Author : Arvin Ghosh

Publisher : Routledge

Page : 137 pages

File Size : 18,71 MB

Release : 2017-07-05

Category : Business & Economics

ISBN : 1351496751

Get eBook

Book Description

In this timely volume on newly emerging financial mar- kets and investment strategies, Arvin Ghosh explores the intriguing topic of initial public offerings (IPOs) of securities, among the most significant phenomena in the United States stock markets in recent years. Before the 2000-2001 market turndown, hardly a week went by when more than a few companies did not become public, either in the organized stock exchange or in the Over the Counter (OTC) market. In the often over-burdened, technology-heavy Nasdaq market, the role of IPOs was crucial for the market's new vigor and growth. Internet stocks were able to find a mode to supply key momentum to the market. In the so-called "New Economy" of the 1990s, it was the seductively accessible IPO that ushered in the world's information technology revolution.Ghosh sets out to examine the pricing and financial performance of IPOs in the United States during the period 1990-2001. In the opening chapter he discusses the rise and fall of IPOs in the preceding decade. Chapter 2 further delineates the IPO process from the start of the prospectus to the end of the "quiet period" and aftermarket stabilization. In chapter 3 Ghosh analyzes the mispricing and deliberately deceptive underpricing, or "flipping," of Internet IPOs. Chapter 4 delves deeper into the pricing and operating efficiency of Nasdaq IPOs. Chapter 5 analyzes the pricing and long-run performance of IPOs both in the New York Stock Exchange and in the Nasdaq markets. In chapters 6 and 7 the author deals with the pricing and performance of the venture-blocked and nonventure-backed IPOs in general and Internet IPOs in particular. In chapter 8 he analyzes the role of underwriters as market makers. In chapter 9 Ghosh discusses the accuracy of analysts' earnings forecasts. In the concluding chapter, he summarizes the principal findings of the study and the recent revival of the IPO market and its place in capital formation as well as the latest developments in t



Real and Accrual Earnings Management and IPO Failure Risk

Author : Mohammad Alhadab

Publisher :

Page : pages

File Size : 26,83 MB

Release : 2014

Category :

ISBN :

Get eBook

Book Description

This paper analyzes the relationship between real and accrual earnings management activities and IPO failure risk. Recent research shows that IPO firms manage earnings upward around the offer year utilizing real and accrual earnings management activities (e.g., Wongsunwai, 2012) and that these activities have severe negative consequences for future stock returns and operating performance (e.g., Cohen and Zarowin, 2010; Kothari et al., 2012). Thus, we predict IPO firms that engaged in higher levels of real and accrual earnings management will exhibit a higher probability of failure and lower survival rates. We test this hypothesis based on a sample of 570 IPO firms that went public over the period 1998-2008. We find evidence that IPO firms manipulate earnings upward utilizing real and accrual earnings management around the IPO. We also find that IPO firms with higher levels of real and accrual earnings management during the IPO year have a higher probability of IPO failure and lower survival rates in subsequent periods.